Former Ruling Party Loses Majority In Armenian Parliament

Former President Serzh Sarkisian’s Republican Party (HHK) technically lost its majority in Armenia’s parliament on Wednesday when yet another deputy defected from its parliamentary faction.

The lawmaker, Samvel Aleksanian, did not immediately make a public statement on his exit announced by the HHK’s parliamentary leader, Vahram Baghdasarian.

The defection reduced to 52 the number of seats officially controlled by the HHK in the 105-member National Assembly. The party held 58 seats until Sarkisian resigned as prime minister on April 23 amid mass protests against his continued rule. The defections from its ranks began shortly after the protest leader, Nikol Pashinian, was elected prime minister last month.

Aleksanian, 49, is one of Armenia’s richest men who has long controlled lucrative imports of sugar, cooking oil and other basic foodstuffs. He has had close ties with the country’s former leaders, notably Sarkisian. The tycoon has been a parliament deputy representing the HHK since 2003.

Aleksanian left the HHK faction one week after a food supermarket chain owned by his family was accused by the National Security Service (NSS) of large-scale tax evasion.

An NSS statement said Yerevan City supermarkets have illegally sold agricultural products and many other items through 461 small firms mainly registered in the name of its employees and their family members. Some of those workers were not even aware of that, it said.

Under Armenian law, small firms with an annual turnover of up to 115 million drams ($237,000) are exempt from profit and value-added (VAT) taxes paid by larger businesses. They are only required to pay “turnover tax” equivalent to 2 percent of their revenue. The VAT rate is set at 20 percent.

Aleksanian has still not commented on the tax evasion allegations. But the chief executives of Yerevan City and a dozen other supermarket chains, also accused by the NSS of tax fraud, issued a joint statement last week saying that they were allowed by the previous leadership of the State Revenue Committee (SRC) to avoid paying VAT in order to keep food prices low. They warned that the NSS crackdown could put their continued operations at serious risk.